06 October 2016
by Eryk Bagshaw

An end to the country's largest get-rich-quick scheme

Vocational scheme shakeout: Education Minister Simon Birmingham.

The party is over for the cowboys, shonks and shysters who grew drunk on billions of dollars in taxpayer funding through the government's failed vocational education scheme.

The great equaliser of the Gillard government turned bipartisan disaster has cost the public at least $2.9 billion since 2012, while students in some of Australia's poorest communities have been saddled with debt they will never repay for courses they never needed.

"It is hard to avoid, whoever put this scheme together did not think it through very much," Federal Court judge Nye Perram​ said in July.

Justice Perram was generous. This scheme was not thought through at all.

A lack of regulation from the Gillard government and the slow reaction of the Abbott administration allowed education brokers to roam Aboriginal missions, nursing homes and housing commissions, on the premise they were providing education to the barely literate.

Tens of thousands of students were signed up by brokers to courses like "salon management" and "digital marketing" in exchange for a free laptop and $20,000 of debt.

Last year federal Education Minister Simon Birmingham cut the music to a party that had already spiralled out of control by banning the use of laptops as incentives, on Wednesday, he finally turned out the lights.

If his proposed changes pass through Parliament, an end to the country's largest get-rich quick scheme will be achieved by the seemingly obvious: Asking colleges to publish completion rates to justify their funding and for students to show they have been regularly active in a government-run portal.

These two hurdles alone will help to remove the target market of the scandal-plagued sector: the student who never turned up to class.

But the real kicker will be caps on student loans.

A $5000 limit on a diploma of business management will be a fatal blow for those motivated by profit in an environment where charges of $18,000 are the norm for a course that costs a quarter of that to deliver.

Senator Birmingham's cap of $15,000 on courses like agriculture and engineering also makes more sense than Labor's $8000 cap on all vocational courses.

Dodgy colleges have no interest in delivering courses that actually cost money.

By tomorrow, many cowboys will already have one boot out the door.

And there's the dilemma for the government's future management of this scheme.

When government money gets withdrawn colleges collapse, as has happened in the past year, leaving students with half-finished diplomas and thousands of dollars of debt.

A spokesman for Mr Birmingham said support networks would be established to help students through any ​transition.

"Protecting students is really going to be a key focus over the coming months," he said.

It should have been $2.9 billion and four years ago.